Carlsberg posts £4.66bn loss after losing Russian unit

Danish brewer Carlsberg posted Wednesday a loss of 40.8 billion kroner (£4.66bn) for 2023 after Moscow took control of its Russian unit following the company's decision to sell the business and exit the country.

Carlsberg had announced in June that a buyer had been found for Baltika, which it has owned since 2000, but President Vladimir Putin later signed a decree saying the state was taking over the business.

While the loss of Baltika pushed Carlsberg into a loss, the company, however, has seen revenue growing 4.7 per cent to 73.58bn kroner, driven by price increases to offset higher costs due to soaring inflation.

Sales volume dipped 0.5 per cent, as strong growth in Asia (+3.7%) was offset by declines in Western Europe (-2.3%) and Central & Eastern Europe (-4.0%).

Among the group’s international brands, Tuborg and 1664 Blanc have each seen volume growth of 3 per cent, while Carlsberg volumes were flat. Alcohol-free brews went up by 3 per cent.

“We delivered a solid set of results for 2023, which were achieved despite a challenging consumer environment, significant inflationary pressure and currency headwinds,” Jacob Aarup-Andersen, chief executive, said.

“The outperformance of our premium portfolio and our results in key Asian markets in 2023 are an affirmation that we have a strong platform to expand from.”

Russia had been one of Carlsberg's biggest markets, accounting for 9 per cent of profits in 2021. The decision to exit the country had already pushed the company into a net loss of 1.06 billion kroner in 2022.

In October, Carlsberg announced it had cut licensing agreements with Baltika Breweries which allowed the local business to produce, market and sell Carlsberg products.

The company said Wednesday that Baltika will be able to use up existing stock and materials until April this year.

"We continue to take all possible actions, including legal, to protect assets and operations," Carlsberg said.